Strategy First: The Critical Missing Element in Failed Product Launches

In my work with clients across Agriculture, Food, and Chemicals industries, I’ve observed three common
strategic failures that consistently lead to product launch disappointments:

1. Unclear or Overly Broad Strategy

Without clear strategic direction, companies often fall into what BCG calls “zombie innovation” – going
through the motions with innovation activities that waste resources on products and services that
customers don’t want or value. Recent research shows that 52% of innovation executives cite unclear or
overly broad strategy as one of their top three challenges[5].

Consider these contrasting approaches:

Company A: “We need to be more innovative. Let’s capture employee ideas and see what we can
develop.”

Company B: “We’ve identified precision application technology as a strategic growth area where we have
technical capabilities and growing market demand. Our innovation will focus on developing solutions
that potentially reduce input costs for farmers by 15% or more whilst maintaining yield.”

Company A might generate hundreds of ideas spanning dozens of areas, spreading resources too thin
and failing to build meaningful competitive advantage in any area. Company B, by contrast, has defined
both a focused domain and specific success criteria that can guide decision-making throughout the
innovation process.

Research by Cooper and Edgett shows that companies with clearly articulated innovation strategies see a
32% higher success rate for their new products than those without such guidance[2]. BCG’s research
reinforces this, showing that companies adopting four or more best practices for linking business and
innovation strategy achieve 5% higher sales from new products compared to the median[5].

2. Missed Focus on Innovation Domains

In the chemicals industry, companies that lack a strategic focus on specific innovation domains try to
pursue too many opportunities simultaneously. This results in insufficient expertise development and
minimal competitive advantage.

By contrast, companies like Novo Nordisk and Eli Lilly demonstrate the power of sustained commitment
to targeted domains. Their decades-long focus on diabetes research ultimately positioned them to
develop breakthrough treatments for obesity. This didn’t happen by accident but through strategic
patience and cumulative knowledge building in a specific domain.

3. Poor Market Segmentation

Companies frequently overestimate market demand by not understanding customer needs or
segmenting the market effectively. This leads to overinvestment in broad, fragmented sales efforts that
yield little return.

As noted in an industry study by EY, “Companies with exceptional new materials tend to believe their
products appeal to a much broader market than they actually do”[3]. This optimism bias results in
diffused marketing efforts and positioning that doesn’t resonate strongly with any specific customer
segment.

Effective innovation strategy requires granular market segmentation that identifies:

• Which specific customer segments have the most pressing needs
• Which segments align best with your capabilities and strategic goals
• Which segments offer the most attractive economic opportunities
• How segments differ in their requirements and adoption behaviours

Without this clarity, companies develop products for theoretical “average” customers who don’t actually
exist, missing opportunities to deliver exceptional value to specific segments.